Workers compensation benefits guide April 2018

128 Pages·2017·1.65 MB·English

Workers compensation
benefits guide
April 2018

State Insurance
Regulatory
Authority
Contents
What benefits are workers entitled to? ................................................................................................... 3
Indexation ........................................................................................................................................................... 14
Weekly payments ............................................................................................................................................ 19
Death benefits and funeral expenses ..................................................................................................... 64
Permanent impairment benefits ............................................................................................................... 82
Medical, hospital and rehabilitation expenses................................................................................... 124

2 Workers compensation benefits guide
What benefits are workers entitled to?
Depending on the individual claim and the type, nature and severity of the work related
injury, a worker may be eligible for the following compensation benefits:
• weekly payments
• permanent impairment
• medical, hospital and rehabilitation expenses
• property damage expenses.
Death benefits and funeral expenses may be payable when a worker dies as a result of a
workplace injury.
Legislation
The legislation provides different amounts of benefits depending on the period of
incapacity, the date of the injury and the date the claim was lodged.
Benefits may be payable under the following Acts:
• Workers Compensation Act 1987 (1987 Act)1
• Workers Compensation (Dust Diseases) Act 1942
• Workplace Injury Management and Workers Compensation Act 1998 (1998 Act)2.
Most provisions of the 1987 Act came into force on 30 June 1987 and apply to injuries
from that date. Subsequent legislative changes made to the 1987 Act and related
legislation that are relevant to matters covered in this Guide include:
• amendments passed in 1989 restored limited entitlements, retrospective to 30 June
1987, for seriously injured workers to sue their employer for damages at common
law. Those provisions included an eligibility threshold related to the seriousness of
the worker’s injury
• amendments effective from 1 February 1992 increased the maximum workers
compensation lump sum entitlements for permanent injury (section 66) and pain
and suffering (section 67) by 25 per cent and reduced the level of the common law
eligibility threshold so that larger numbers of injured workers would qualify for
common law claims
• amendments effective from 1 September 1994 increased lump sum benefits for
severe facial and bodily disfigurement to 80 per cent and 50 per cent respectively
of the maximum permanent injury lump sum under section 66
• amendments effective from 1 January 1996 introduced lump sum benefits under
sections 66 and 67 for HIV/AIDS and bowel injuries
• amendments effective from 12 January 1997 reduced the maximum lump sum for
permanent impairment under sections 66 and 67 by 25 per cent

1 The provisions of the former Workers Compensation Act 1926, which was repealed and replaced with the Workers
Compensation Act 1987, cover most injuries incurred prior to 30 June 1987. The Workers Compensation Act 1987 has
special rules to ensure that benefits payable under the former Workers Compensation Act 1926 continue to apply, with
appropriate adjustments. These rules are referred to as the Workers Compensation Act 1987 (re 1926 Act).
2 The Workers Compensation Act 1987 and the Workplace Injury Management and Workers Compensation Act 1998
should be read together.
State Insurance Regulatory Authority 3
• the 1998 Act (apart from injury management provisions) commenced on 1 August
1998 together with changes to the 1987 Act made by the 1998 Act. The injury
management provisions commenced on 1 September 1998. The 1998 legislation
continues the benefit provisions of the 1987 Act with some exceptions such as
reducing section 38 benefits from a maximum of 104 weeks to 52 weeks for those
who first receive section 38 benefits on or after 1 August 1998
• amendments effective from 27 November 2001 that affect common law claims:
where a claim is filed with the court after 9.00am, 27 November 2001, no
damages are awarded unless the degree of permanent impairment of a worker is
at least 15 per cent
the degree of permanent impairment is assessed using the WorkCover Guides for
the Evaluation of Permanent Impairment
common law damages for a worker are only awarded in respect of past and
future loss of earnings
all workers compensation benefits (except common law payments) are available
even if a common law claim has been lodged. However, once common law
damages are received, then entitlement to any further workers compensation
benefits cease, and any weekly payments that have been made to the worker will
be deducted from the common law payments.
• amendments effective from 1 January 2002 that affect workers compensation
benefits other than common law payments:
the maximum lump sum benefit under section 66 was increased to $200,000 for
injuries received on or after 1 January 2002. The maximum lump sum benefit for
section 67 remains at $50,000
for injuries received from 1 January 2002, benefits under section 66 are
determined by the degree of permanent impairment of the worker in accordance
with the WorkCover Guides for the Evaluation of Permanent Impairment
primary psychological or psychiatric injuries are eligible for the benefits under
section 66 (permanent impairment), provided that the degree of permanent
impairment is at least 15 per cent (section 65A(3))
to be eligible for compensation under section 67 (pain and suffering) the degree
of permanent impairment must be at least 10 per cent for a physical injury or at
least 15 per cent for a primary psychological or psychiatric injury
single and multiple physical injuries that have resulted from an accident are
assessed together to determine the degree of permanent impairment of the
injured worker. Permanent impairments arising from primary psychological or
psychiatric injuries are assessed separately from physical injuries. In all cases,
secondary psychological or psychiatric injuries are disregarded in determining
the degree of permanent impairment
if a worker receives a primary psychological or psychiatric injury and a physical
injury arising out of the same incident, the worker is entitled to receive
compensation for impairment resulting from only one of these injuries, whichever
results in the greater amount of compensation being payable.
• for injuries occurring on or after 1 January 2006, amendments to section 66 (2A) of
the 1987 Act increased the amount of compensation payable for permanent
impairment of the spine by an additional five per cent. The maximum amount
payable under section 66 of the 1987 Act was increased from $200,000 to $210,000
4 Workers compensation benefits guide
• for injuries incurred on or after 1 January 2007, the lump sum payable for permanent
impairment (under section 66 of the 1987 Act) was increased by 10 per cent, up to a
maximum of $231,000. The 10 per cent increase applies to all types of permanent
impairment, including spinal impairments
• the Workers Compensation Legislation Amendment (Benefits) Act 2008 introduced
a number of amendments to workers compensation death benefits. These
amendments:
increased the lump sum death benefit to $425,000
allow the lump sum death benefit to be paid to a worker’s estate where the
deceased leaves no dependants
ensure that weekly payments to a dependant are not to be reduced because of
partial dependency. However, partial dependency may still be taken into account
when apportioning the lump sum between multiple dependants
are retrospective and apply to deaths that occur on or after 24 October 2007,
and are as a result of workplace injuries that occurred on or after 30 June 1987.
• a number of amendments to the lump sum death benefit payable under the Workers
Compensation (Dust Diseases) Act 1942 commenced on 7 December 2010, these
amendments:
increased the lump sum death benefit payable to dependants of deceased
workers from $245,700 (current amount payable) to $311,050. The increase was
implemented in three annual increments:
▪ the first increment of $268,375 was payable on commencement of the
Workers’ Compensation (Dust Diseases) Amendment Act 2010
(7 December 2010)
▪ the second increment of $291,040 was payable 12 months from the first
increment
▪ the final increment of $311,050 was payable 24 months from the first
increment.
enable the Dust Diseases Board to take into account the age of the worker when
determining the amount of lump sum compensation to be paid to a dependant of
the deceased worker.
The lump sum was not indexed during this period. Indexation of the lump sum
recommenced on 1 April 2013.
• The Workers Compensation Legislation Amendment Act 2010 introduced a number
of amendments to workers compensation legislation. The amendments commenced
on 1 February 2011 and included the following changes to benefits related provisions:
clarification that the maximum statutory cap for weekly benefits (section 40 of
the 1987 Act) is applied to the compensation payment only. This means that the
cap applies to the make-up pay component of a worker’s weekly income, not the
total amount received by the worker, including wages or salary. The amendment
applies to periods of incapacity from 1 February 2011 regardless of the date of
injury
removal of restrictions on the maximum amount for which an employer is liable
for workplace rehabilitation services provided to an injured worker (repeal of
sections 63A(3) and (4) of the 1987 Act)
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commencement of indexation of the maximum amount for an interim payment
direction for medical expenses (section 297(2) of the 1998 Act) from 1 April 2011.
June 2012 workers compensation reforms
The Workers Compensation Legislation Amendment Act 2012 introduced a number of
changes to workers compensation benefits. The Act was passed by Parliament on
22 June 2012 and assented on 27 June 2012.
• The new laws change the way workers compensation benefits claims are assessed
and paid. The changes affect all new and existing workers compensation claims,
except for claims from:
police officers, paramedics and fire fighters
workers injured while working in or around a coal mine
bush fire fighter and emergency service volunteers (Rural Fire Service, Surf Life
Savers, SES volunteers)
people with a dust disease claim under the Workers Compensation (Dust
Diseases) Act 1942.
• Claims by these exempt workers will continue to be managed and administered as
though the June 2012 changes never occurred.
Changes with effect on and after 19 June 2012
• For permanent impairment lump sum compensation claims made on or after
19 June 2012:
payments for pain and suffering under section 67 of the Workers Compensation
Act 1987 are no longer available
a threshold of more than 10 per cent permanent impairment for physical injury
(including hearing loss) must be reached to access a permanent impairment
lump sum. The threshold for a primary psychological injury lump sum payments
remains at 15 per cent permanent impairment.
• Workers are no longer entitled to make multiple permanent impairment claims. Only
one claim can be made for permanent impairment compensation in respect of an
injury.
• Journey claims for an injury received on or after 19 June 2012 can only be made if
there is a real and substantial connection between the employment and the incident
out of which the injury arose.
• No compensation is payable for heart attack and stroke injuries received on and
after 19 July 2012 unless the nature of the employment concerned gave rise to a
significantly greater risk of the worker suffering the injury than had the worker not
been employed in employment of that nature.
• Definition of ‘injury’ amended which refers to a ‘disease injury’ as a disease that is
contracted in the course of employment only if the employment was the main
contributing factor. ‘Disease injury’ also encompasses the aggravation, acceleration,
exacerbation or deterioration in the course of employment of any disease provided
the employment was the main contributing factor. This applies to all injuries
received on and from 19 June 2012.
• The amendments prevent a claim for damages for nervous shock where the nervous
shock is not a work injury and prevent a claim for damages by relatives of an injured
6 Workers compensation benefits guide
or deceased worker because the relative’s injuries are not work injuries. The
amendments do not apply where court proceedings for nervous shock claims
commenced before 19 June 2012.
Seriously injured workers
The following reforms for seriously injured workers (injured workers with a permanent
impairment of more than 30 per cent) came into effect on 17 September 2012.
• The minimum amount used to calculate the weekly payment was increased to
$736.72 gross.
• There is no time cap on weekly payments, except for the Commonwealth
retirement age.
• There is no time limit on payments for reasonably necessary medical and related
expenses.
• Will not have to undergo a work capacity assessment every two years – unless the
worker requests one to explore return to work options.
Weekly payments
The changes to weekly benefits came into effect on:
• 1 October 2012 for new claims
• 1 January 2013 for existing claims.
The changes to weekly benefits included:
• a simplified method for calculating worker entitlements based on the worker’s pre-
injury average weekly earnings - incorporating overtime and shift allowance in the
initial 52 weeks of weekly payments
• up to 95 per cent of pre-injury average weekly earnings for the first 13 weeks of a
claim
for weeks 14 to 130, weekly payments will be 80 per cent of pre-injury average
weekly earnings. If a worker returns to work for at least 15 hours per week,
weekly payments will be made up to 95 per cent of pre-injury average weekly
earnings.
• 130 week limit – for all workers except where workers meet specified requirements
workers who are fit to do some work and are not performing at least 15 hours of
paid work per week by the 130th week of incapacity payment will not be entitled
to payments after the 130th week
workers who do achieve an actual return to work of more than 15 hours, or have
no capacity for work, or have an impairment of more than 30 per cent of the
whole person are not subject to this time limit.
• five year limit
workers with a whole person impairment of 20 per cent or less may only receive
up to 260 weeks (five years) worth of weekly payments
workers with permanent impairment of more than 20 per cent are not subject to
this time limit.
• weekly payments and retirement:
if an injury occurs before retiring age, a worker may be entitled to weekly
payments until reaching retiring age
State Insurance Regulatory Authority 7
if an injury occurs after reaching retiring age, a worker may be entitled to weekly
payments in the period up to 12 months after the first date of incapacity.
Work capacity assessments
• Work capacity assessments will be undertaken by the insurer. The assessment
involves a review of the injured worker’s medical, functional and vocational status,
and helps to inform decisions about the injured worker’s capacity to return to work
in suitable employment and entitlement to weekly benefits.
• A work capacity assessment can occur at any point in the life of the claim. A
decision must be made on the injured worker’s work capacity by 130 weeks and then
will be reviewed at least every two years thereafter.
WorkCover Independent Review Officer
The June 2012 reforms also enabled the establishment of a WorkCover Independent
Review Officer (WIRO) (from September 2015 known as the Workers Compensation
Independent Review Officer). From 1 October 2012, the WIRO is responsible for:
• investigating complaints made by workers about insurers, and making
recommendations for action to be taken by the insurer or the worker
• reviewing work capacity decisions by insurers
• encouraging high quality complaint resolution by insurers and employers
• reporting annually to the Minister and the Parliament on their responsibilities
• administering the Independent Legal Assistance and Review Service. This service
facilitates access to free independent legal advice to injured workers, in
circumstances where there is a disagreement with insurers regarding entitlements.
Medical and related expenses
• The changes to payments for medical and related treatment came into effect on :
1 October 2012 for new claims
1 January 2013 for existing claims.
• Under the changes, payments for medical and related treatment will end at
whichever occurs last:
where no weekly payments for compensation are payable, 12 months after the
claim for compensation is made, or
12 months after the last payment of weekly benefits.
This restriction does not apply to workers with a permanent impairment of over
30 per cent. For these workers, entitlement to medical cover will continue for life.

8 Workers compensation benefits guide
September 2014 workers compensation changes
The Workers Compensation Amendment (Existing Claims) Regulation 2014 introduced
a number of changes to workers compensation benefits. These changes apply to
workers who sustained a workplace injury and who had made a claim for compensation
for that injury before 1 October 2012. These changes do not apply to workers who
made a claim after that date.
The changes allow:
• workers to continue to receive certain medical and related expenses until retiring
age
• workers with whole person impairment of 21 per cent to 30 per cent to have access
to medical and related expenses up until retiring age
• for the insurer to meet the cost of any secondary surgery
• that workers may receive weekly payments while a work capacity decision is being
reviewed
• entitlement to weekly payments for up to one year after retiring age.
Medical and related expenses
As a result of the changes, a worker may have continued access to certain medical and
related expenses until retiring age.
• Workers with a permanent impairment of between 21 per cent and 30 per cent will
have continued access to ongoing reasonably necessary medical and related
expenses until retiring age.
• For all other claims made before 1 October 2012, workers requiring the following
types of medical and related treatment will have continued access until retiring age
regardless of their degree of permanent impairment:
home and vehicle modifications
crutches
artificial members
eyes or teeth
spectacles or other artificial aids (including hearing aids and hearing aid
batteries).
The insurer is still required to pre approve any such treatment or service.
If a worker disputes the insurer’s decision, an unresolved matter may be referred to the
Workers Compensation Commission. The Independent Legal Assistance and Review
Service (ILARS) provides funding to pay for costs incurred by injured workers when
disputing decisions made by the insurer.
Secondary surgery
Workers who require secondary surgery are entitled to receive it, as long as the
secondary surgery:
• is directly consequential to an earlier surgery
• affects a part of the body affected by the earlier surgery
• is approved by the insurer within two years of approval of the earlier surgery.
The insurer is still required to pre approve any such treatment or service.
State Insurance Regulatory Authority 9
If a worker disputes the insurer’s decision, an unresolved matter may be referred to the
Workers Compensation Commission. The Independent Legal Assistance and Review
Service (ILARS) provides funding to pay for costs incurred by injured workers when
disputing decisions made by the insurer.
Eligibility for weekly payments until a review of a work capacity decision has
been completed
In 2012, ‘work capacity’ was introduced into the NSW workers compensation system. At
certain points during a worker’s claim, the insurer makes a work capacity decision
which can affect a worker’s entitlement to weekly payments.
Work capacity decisions can be reviewed through a three-step review process:
1. After a worker receives a work capacity decision notice they may request an internal
review by the insurer.
2. If a worker is not satisfied with the outcome of an insurer’s internal review, or if the
review is not completed within 30 days, the worker may lodge an application for the
State Insurance Regulatory Authority (SIRA) to carry out a merit review of the
insurer’s internal review decision.
3. If a worker is not satisfied with the outcome of a SIRA merit review, the worker may
lodge an application for procedural review by the Workers Compensation
Independent Review Officer within 30 days of receiving the merit review decision.
If a worker requests a review of a work capacity decision within 30 days after the day
of receiving notification of the decision (whether the decision is an initial work capacity
decision, an internal review decision or a merit review decision), an insurer may be
prevented from taking action (such as reducing or ceasing weekly payments) while the
work capacity decision is being reviewed, or until the worker withdraws the application
for review.
Weekly payments on retiring age
Under the changes a worker is entitled to receive weekly payments for a maximum of 12
months after reaching retiring age.

10 Workers compensation benefits guide